Is This the Right Time to Be Investing in Gold?

I can tell you right now that this article is going to be very different from any other articles that you have read so far. And the difference is dear reader, that I'm not trying to sell you anything.

You see, most of the articles on investing in gold is simply horribly written or way out of touch. I have to question the credibility and whats-in-it-for-them of most information on gold articles on the Net.

Simply, gold is a medium of exchange that has been used by humans for 1000s of years. So what is so valuable about a lump of yellow metal that doesn't pay dividends or interest?

The answer of course is that gold is a scarce commodity that cannot be multiplied by the printing presses 24/7. As Jim Rogers was telling us about the upcoming commodity bull market back in 1998, most commodities including Gold and Silver, are not that easy to mine anymore. All the easy stuff has already been dug up. Some Gold mines consider it good if they can get 20-30 grams per ton!

And not only that, many times the kind of rock that the gold is found in can determine the cost of mining. There are also many other variables for new mines to face, such as huge start up costs, transportation distance, anti-mining stances of governments and so on.

In short, precious metals such as Gold and Silver isn't easy to dig up anymore. And besides, one of the biggest paradoxes I've heard of is this, that "We go deep into the dirt to dig up the Gold. And then we bury the Gold in safe deposit boxes."

So if Gold and Silver are pretty scarce and the governments all around the world are cranking up their printing presses to get their country out of the fiscal and economic messes, then Gold and Silver is going to keep on going up. This is the major reason why investing in gold and Silver in inflationary periods is a very good idea.

And that is because there will be more paper or fiat money chasing after the real stuff, commodities. I hope that makes a little more sense to you.

But I am getting a little ahead of myself here. Why is it different this time? Well, in 2008 the housing lottery finally went kaput because of the owners that defaulted on their Subprime mortgages. And that is deflationary (declining home prices), which the politicians will never... EVER! Allow to happen.

And why not you ask? Well, if the housing market is allowed to continue in a downward spiral, then everyone is going to drop their keys in the mailbox and walk away from their homes because they have negative equity in the home and can't afford to keep paying the mortgage on a money loser.

And if THAT happens, banks start to go bankrupt and then the economy goes straight to hell in a hand-basket. And then more and more people lose their jobs and it just keeps getting worst. This is what happened during the Great Depression.

So ask anyone over the age of 75 what it was like back then and they will tell you that everyone lived on their wits alone. It was a horrible, horrible time.

And if the depression is allowed to happen, people are going to blame the politicians that are currently in power for that predicament. And THAT is why politicians will never allow a depression to happen. They will want to inflate the housing market. And the way to do that is to "Crank Up" the printing presses. And that is what most of the governments all around the world is doing today. Massive inflation is preferable to the pain of a depression.

Go figure.

Eventually, Gold and Silver is going to go higher and further than anybody expects. Some of you may still remember the late 1970s and early 1980s of hyperinflation. Interest rates were up as high as 20% annually. Foods and gasoline prices changed every week and sometimes every day.

This is going to be a very uncomfortable period of time for those who didn't prepare for the coming massive inflation. But those that do their homework and study the various ways to invest in commodities and investing in gold and silver are going to come out OK.

One more detail about investing in Gold, It is a very good investment vehicle during inflationary times such as now or even back in the 1980s. But a horrible investment during deflationary times such as the Great Depression during the 1929-1944.

You can read more resources at http://www.squidoo.com/Investing-Gold to protect yourself and your family's financial future.